Fourth Quarter 2023 Highlights:
- Net sales: $203.1 million
- Operating income: $12.0 million
- Net earnings: $2.0 million
- Adjusted EBITDA*: $25.6 million; Adjusted EBITDA margin*: 12.6%
- Diluted earnings per share: $0.07 per share, $0.12 per share adjusted*
Full Year 2023 Highlights:
- Net sales: $775.9 million
- Operating income: $49.1 million
- Net earnings: $7.9 million
- Adjusted EBITDA*: $106.7 million; Adjusted EBITDA margin*: 13.7%
- Diluted earnings per share: $0.28 per share, $0.49 per share adjusted*
BLOOMFIELD, Conn.–(BUSINESS WIRE)–Kaman Corp. (NYSE:KAMN) (“Kaman” or “the Company”) today reported financial results for the fourth fiscal quarter and full year ended December 31, 2023.
| Table 1. Summary of Financial Results (unaudited) | ||||||||||||||||||||
|
Thousands of U.S. dollars (except share data) |
 |
Three Months Ended |
 |
Twelve Months Ended |
||||||||||||||||
|
 |
 |
December 31, |
 |
September 29, |
 |
December 31, |
 |
December 31, |
 |
December 31, |
||||||||||
|
Net sales |
 |
$ |
203,123 |
 |
 |
$ |
183,031 |
 |
 |
$ |
197,143 |
 |
 |
$ |
775,854 |
 |
 |
$ |
687,961 |
 |
|
Net earnings (loss) |
 |
 |
1,995 |
 |
 |
 |
1,466 |
 |
 |
 |
(55,942 |
) |
 |
 |
7,947 |
 |
 |
 |
(48,573 |
) |
|
Adjusted EBITDA* |
 |
 |
25,617 |
 |
 |
 |
25,232 |
 |
 |
 |
29,721 |
 |
 |
 |
106,675 |
 |
 |
 |
77,241 |
 |
|
Adjusted EBITDA margin* |
 |
 |
12.6 |
% |
 |
 |
13.8 |
% |
 |
 |
15.1 |
% |
 |
 |
13.7 |
% |
 |
 |
11.2 |
% |
|
Diluted earnings (loss) per share |
 |
$ |
0.07 |
 |
 |
$ |
0.05 |
 |
 |
$ |
(1.99 |
) |
 |
$ |
0.28 |
 |
 |
$ |
(1.73 |
) |
|
Adjusted diluted earnings per share* |
 |
$ |
0.12 |
 |
 |
$ |
0.10 |
 |
 |
$ |
0.38 |
 |
 |
$ |
0.49 |
 |
 |
$ |
1.04 |
 |
*See the end of this release for an explanation of the Company’s use of Adjusted EBITDA, Adjusted EBITDA margin, Free cash flow and Adjusted diluted earnings per share from continuing operations. See tables 5-11 for reconciliations to the most comparable GAAP measure.
(1) Information for the period ended December 31, 2022 has been revised from amounts reported in the prior year to correct errors related to the accounting for certain labor costs at one business in the Precision Products segment and the net realizable value on certain portions of the Company’s inventory at another business in the Structures segment. These errors resulted in an understatement of cost of sales, net of tax, of $1.0 million and $2.3 million, in the three-month and twelve-month fiscal periods ended December 31, 2022, respectively. Refer to the Company’s Form 10-K for the year ended December 31, 2023 for further information.
“Our Engineered Products segment achieved another strong quarter and we delivered full year results in line with our revised outlook,” said Ian K. Walsh, Chairman, President and Chief Executive Officer. “Our results reflect our continued execution in reshaping our portfolio, optimizing cost structure and eliminating major sources of variation in performance as we remained disciplined in our approach to capital allocation and realized additional opportunities to reduce expense across the organization.”
MERGER
As announced on January 19, 2024, we have entered into a merger agreement wherein Arcline Investment Management, L.P. (“Arcline”) will acquire Kaman. Under the terms of the agreement, Arcline will purchase Kaman in an all-cash transaction for $46.00 per share, equating to an enterprise value of approximately $1.8 billion. The transaction is subject to customary closing conditions, including approval by Kaman shareholders and receipt of required regulatory approvals. The transaction is currently expected to close in the first half of 2024.
KAMAN BUSINESS RESULTS DISCUSSION BY REPORTING SEGMENT
Kaman manages its portfolio through three segments: (1) Engineered Products; (2) Precision Products; and (3) Structures.
Engineered Products – Our Engineered Products segment serves the aerospace and defense, industrial and medical markets providing sophisticated, proprietary aircraft bearings and components; super precision, miniature ball bearings; proprietary spring energized seals, springs and contacts; and wheels, brakes and related hydraulic components for helicopters, fixed-wing and UAV aircraft.
|
Table 2. Engineered Products Results |
 |
 |
 |
 |
 |
 |
||||||||||||||
|
Thousands of U.S. dollars |
 |
Three Months Ended |
 |
Twelve Months Ended |
||||||||||||||||
|
 |
 |
December 31, |
 |
September 29, |
 |
December 31, |
 |
December 31, |
 |
December 31, |
||||||||||
|
Net sales |
 |
$ |
132,394 |
 |
 |
$ |
123,598 |
 |
 |
$ |
113,972 |
 |
 |
$ |
512,831 |
 |
 |
$ |
377,241 |
 |
|
Operating income |
 |
 |
28,939 |
 |
 |
 |
29,026 |
 |
 |
 |
17,168 |
 |
 |
 |
107,863 |
 |
 |
 |
57,833 |
 |
|
Adjusted EBITDA |
 |
 |
38,308 |
 |
 |
 |
38,428 |
 |
 |
 |
30,698 |
 |
 |
 |
147,514 |
 |
 |
 |
91,353 |
 |
|
Adjusted EBITDA margin |
 |
 |
28.9 |
% |
 |
 |
31.1 |
% |
 |
 |
26.9 |
% |
 |
 |
28.8 |
% |
 |
 |
24.2 |
% |
Three months ended December 31, 2023 versus three months ended September 29, 2023 – Operating income and Adjusted EBITDA remained relatively flat and margin decreased 2.2 percentage points versus the third quarter of 2023. Results remained strong in the fourth quarter driven by higher sales and gross margin on our commercial bearings and aircraft wheels and brakes, partially offset by lower sales volume on our springs, seals and contacts used in medical applications.
Three months ended December 31, 2023 versus three months ended December 31, 2022 – Operating income increased $11.8 million, Adjusted EBITDA increased $7.6 million and margin increased 2.0 percentage points versus the fourth quarter of 2022. Results improved compared to the prior period driven by higher sales and gross margin on our commercial bearings, PMA aftermarket parts and aircraft wheels and brakes and the absence of the inventory step-up of $2.3 million recorded in the prior year associated with the Aircraft Wheel and Brake acquisition.
Precision Products – Our Precision Products segment serves the aerospace and defense markets providing precision safe and arming solutions for missile and bomb systems for the U.S. and allied militaries; subcontract helicopter work; restoration, modification and support of our SH-2G Super Seasprite maritime helicopters; support of our heavy lift K-MAX® manned helicopter, and development of the KARGO UAV unmanned aerial system, a purpose built autonomous medium lift logistics vehicle.
|
Table 3. Precision Products Results |
 |
 |
 |
 |
 |
 |
||||||||||||||
|
Thousands of U.S. dollars |
 |
Three Months Ended |
 |
Twelve Months Ended |
||||||||||||||||
|
 |
 |
December 31, |
 |
September 29, |
 |
December 31, |
 |
December 31, |
 |
December 31, |
||||||||||
|
Net sales |
 |
$ |
36,019 |
 |
 |
$ |
27,098 |
 |
 |
$ |
49,925 |
 |
 |
$ |
129,147 |
 |
 |
$ |
185,023 |
 |
|
Operating (loss) income |
 |
 |
(536 |
) |
 |
 |
(3,241 |
) |
 |
 |
5,628 |
 |
 |
 |
(4,532 |
) |
 |
 |
16,353 |
 |
|
Adjusted EBITDA |
 |
 |
355 |
 |
 |
 |
(2,458 |
) |
 |
 |
6,413 |
 |
 |
 |
(1,240 |
) |
 |
 |
20,016 |
 |
|
Adjusted EBITDA margin |
 |
 |
1.0 |
% |
 |
 |
(9.1 |
)% |
 |
 |
12.8 |
% |
 |
 |
(1.0 |
)% |
 |
 |
10.8 |
% |
(1)Information for the period ended December 31, 2022 has been revised from amounts reported in the prior year to correct errors related to the accounting for certain labor costs at one business in the Precision Products segment. Refer to the Company’s Form 10-K for the year ended December 31, 2023 for further information.
Three months ended December 31, 2023 versus three months ended September 29, 2023 – Operating loss decreased $2.7 million, Adjusted EBITDA increased $2.8 million and margin increased 10.1 percentage points versus the third quarter of 2023. Results improved compared to the third quarter, driven by higher JPF direct commercial sales and related margin, partially offset by cost growth on a legacy fuzing program and higher R&D spend on the KARGO UAV unmanned aerial system.
Three months ended December 31, 2023 versus three months ended December 31, 2022 – Operating income decreased $6.2 million, Adjusted EBITDA decreased $6.1 million and margin decreased 11.8 percentage points versus the fourth quarter of 2022. Results declined compared to the prior period, driven by cost growth on legacy fuzing and measuring programs and lower sales and related margin of JPF and K-MAX® exchanges.
Structures – Our Structures segment serves the aerospace and defense and medical end markets providing sophisticated complex metallic and composite aerostructures for commercial, military and general aviation fixed and rotary wing aircraft, and medical imaging solutions.
|
Table 4. Structures Results |
 |
 |
 |
 |
 |
 |
||||||||||||||
|
Thousands of U.S. dollars |
 |
Three Months Ended |
 |
Twelve Months Ended |
||||||||||||||||
|
 |
 |
December 31, |
 |
September 29, |
 |
December 31, |
 |
December 31, |
 |
December 31, |
||||||||||
|
Net sales |
 |
$ |
34,710 |
 |
 |
$ |
32,335 |
 |
 |
$ |
33,246 |
 |
 |
$ |
133,876 |
 |
 |
$ |
125,697 |
 |
|
Operating loss |
 |
 |
(5,400 |
) |
 |
 |
(3,020 |
) |
 |
 |
(2,502 |
) |
 |
 |
(9,169 |
) |
 |
 |
(4,623 |
) |
|
Adjusted EBITDA |
 |
 |
(4,667 |
) |
 |
 |
(2,222 |
) |
 |
 |
(1,646 |
) |
 |
 |
(6,063 |
) |
 |
 |
(1,104 |
) |
|
Adjusted EBITDA margin |
 |
 |
(13.4 |
)% |
 |
 |
(6.9 |
)% |
 |
 |
(5.0 |
)% |
 |
 |
(4.5 |
)% |
 |
 |
(0.9 |
)% |
(1)Information for the period ended December 31, 2022 has been revised from amounts reported in the prior year to correct errors related to the net realizable value on certain portions of the Company’s inventory at a business in the Structures segment. Refer to the Company’s Form 10-K for the year ended December 31, 2023 for further information.
Three months ended December 31, 2023 versus three months ended September 29, 2023 – Operating income and Adjusted EBITDA decreased by $2.4 million, and margin decreased 6.5 percentage points versus the third quarter of 2023. Results were impacted by lower gross profit due to changes in profit estimates for long term contracts and lower sales volumes on our programs with Rolls Royce.
Three months ended December 31, 2023 versus three months ended December 31, 2022 – Operating loss increased by $2.9 million, Adjusted EBITDA decreased by $3.0 million, and margin decreased 8.4 percentage points versus the fourth quarter of 2022. Results were impacted by lower gross profit due to changes in profit estimates for long term contracts and lower margin on our programs with Rolls Royce.
Please see the MD&A section of the Company’s Form 10-K filed with the Securities and Exchange Commission concurrently with the issuance of this release for greater detail on our results and various company programs.
CONFERENCE CALL
Given the pending acquisition by Arcline, the Company is not conducting a conference call for the fourth quarter. In addition, the Company is not providing a financial outlook for fiscal year 2024.
ABOUT KAMAN CORPORATION
Kaman Corporation, founded in 1945 by aviation pioneer Charles H. Kaman, and headquartered in Bloomfield, Connecticut, conducts business in the aerospace & defense, industrial and medical markets. Kaman produces and markets proprietary aircraft bearings and components; super precision, miniature ball bearings; proprietary spring energized seals, springs and contacts; wheels, brakes and related hydraulic components for helicopters, fixed-wing and UAV aircraft; complex metallic and composite aerostructures for commercial, military and general aviation fixed and rotary wing aircraft; safe and arming solutions for missile and bomb systems for the U.S. and allied militaries; subcontract helicopter work; restoration, modification and support of our SH-2G Super Seasprite maritime helicopters; support of our heavy lift K-MAX® manned helicopter, and development of the KARGO UAV unmanned aerial system, a purpose built autonomous medium lift logistics vehicle. More information is available at www.kaman.com.
NON-GAAP MEASURES DISCLOSURE
Management believes that the Non-GAAP financial measures (i.e. financial measures that are not computed in accordance with Generally Accepted Accounting Principles) identified by an asterisk (*) used in this release or in other disclosures provide important perspectives into the Company’s ongoing business performance. The Company does not intend for the information to be considered in isolation or as a substitute for the related GAAP measures. Other companies may define the measures differently. We define the Non-GAAP measures used in this release and other disclosures as follows:
Adjusted EBITDA – Adjusted EBITDA for the consolidated company results is defined as net earnings before interest, taxes, other expense (income), net, depreciation and amortization and certain items that are not indicative of the operating performance of the Company for the periods presented. Adjusted EBITDA for the segments is defined as operating income before depreciation and amortization. Adjusted EBITDA margin is defined as Adjusted EBITDA as a percent of Net sales. Management believes Adjusted EBITDA and Adjusted EBITDA margin provide an additional perspective on the operating results of the organization and its earnings capacity and helps improve the comparability of our results between periods because they provide a view of our operations that excludes items that management believes are not reflective of operating performance, such as items traditionally removed from net earnings in the calculation of EBITDA as well as Other expense (income), net and certain items that are not indicative of the operating performance of the Company for the period presented. Adjusted EBITDA and Adjusted EBITDA margin are not presented as an alternative measure of operating performance, as determined in accordance with GAAP. The following tables illustrate the calculation of Adjusted EBITDA:
|
Table 5. Adjusted EBITDA (unaudited) |
 |
 |
 |
 |
||||||||||||||||
|
Thousands of U.S. dollars |
 |
Three Months Ended December 31, 2023 |
||||||||||||||||||
|
 |
 |
Consolidated |
 |
Engineered Products |
 |
Precision Products |
 |
Structures |
 |
Corp/Elims** |
||||||||||
|
Adjusted EBITDA |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Consolidated Results |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Net sales |
 |
$ |
203,123 |
 |
 |
$ |
132,394 |
 |
 |
$ |
36,019 |
 |
 |
$ |
34,710 |
 |
 |
$ |
— |
 |
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Net earnings |
 |
$ |
1,995 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Interest expense, net |
 |
 |
10,648 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Income tax expense |
 |
 |
367 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Non-service pension and post retirement benefit income |
 |
 |
(310 |
) |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Other income, net |
 |
 |
(716 |
) |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Operating income (loss) |
 |
$ |
11,984 |
 |
 |
$ |
28,939 |
 |
 |
$ |
(536 |
) |
 |
$ |
(5,400 |
) |
 |
$ |
(11,019 |
) |
|
Depreciation and amortization |
 |
 |
11,794 |
 |
 |
 |
9,369 |
 |
 |
 |
891 |
 |
 |
 |
733 |
 |
 |
 |
801 |
 |
|
Restructuring and severance costs(1) |
 |
 |
359 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
359 |
 |
|
Integration and implementation costs(2) |
 |
 |
482 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
482 |
 |
|
Costs associated with corporate development activities(3) |
 |
 |
947 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
947 |
 |
|
Program assets impairment(4) |
 |
 |
51 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
51 |
 |
|
Other Adjustments |
 |
$ |
13,633 |
 |
 |
$ |
9,369 |
 |
 |
$ |
891 |
 |
 |
$ |
733 |
 |
 |
$ |
2,640 |
 |
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Adjusted EBITDA |
 |
$ |
25,617 |
 |
 |
$ |
38,308 |
 |
 |
$ |
355 |
 |
 |
$ |
(4,667 |
) |
 |
$ |
(8,379 |
) |
|
Adjusted EBITDA margin |
 |
 |
12.6 |
% |
 |
 |
28.9 |
% |
 |
 |
1.0 |
% |
 |
 |
(13.4 |
)% |
 |
 |
||
(1) Restructuring and severance costs include actions associated with the previously announced cost reduction efforts that include the consolidation of our JPF production facilities and discontinuation of the K-MAX® aircraft production line.
(2) Integration and implementation costs include one-time costs associated with the integration of Aircraft Wheel and Brake and costs associated with the set-up of a new joint venture to satisfy existing offset requirements the Company has with a foreign customer.
(3) Costs associated with corporate development activities include one-time costs associated with the sale of Kaman Corporation and its subsidiaries.
(4) Program assets impairment includes the write-off of long lead parts received in the current period associated with K-MAX® program which were determined to have no alternative use.
**Corp/Elims Operating income (loss) represents the Corporate office expenses and $0.5 million of unallocated expenses that are shown on the Consolidated Statement of Earnings as their own line items.
|
Table 6. Adjusted EBITDA (unaudited) |
 |
 |
 |
 |
||||||||||||||||
|
Thousands of U.S. dollars |
 |
Three Months Ended September 29, 2023 |
||||||||||||||||||
|
 |
 |
Consolidated |
 |
Engineered Products |
 |
Precision Products |
 |
Structures |
 |
Corp/Elims** |
||||||||||
|
Adjusted EBITDA |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Consolidated Results |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Net sales |
 |
$ |
183,031 |
 |
 |
$ |
123,598 |
 |
 |
$ |
27,098 |
 |
 |
$ |
32,335 |
 |
 |
$ |
— |
 |
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Net earnings |
 |
$ |
1,466 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Interest expense, net |
 |
 |
9,405 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Income tax expense |
 |
 |
462 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Non-service pension and post retirement benefit income |
 |
 |
(310 |
) |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Other expense, net |
 |
 |
849 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Operating income (loss) |
 |
$ |
11,872 |
 |
 |
$ |
29,026 |
 |
 |
$ |
(3,241 |
) |
 |
$ |
(3,020 |
) |
 |
$ |
(10,893 |
) |
|
Depreciation and amortization |
 |
 |
11,800 |
 |
 |
 |
9,402 |
 |
 |
 |
783 |
 |
 |
 |
798 |
 |
 |
 |
817 |
 |
|
Restructuring and severance costs(1) |
 |
 |
571 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
571 |
 |
|
Integration and implementation costs(2) |
 |
 |
572 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
572 |
 |
|
Program assets impairment(3) |
 |
 |
417 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
417 |
 |
|
Other Adjustments |
 |
$ |
13,360 |
 |
 |
$ |
9,402 |
 |
 |
$ |
783 |
 |
 |
$ |
798 |
 |
 |
$ |
2,377 |
 |
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Adjusted EBITDA |
 |
$ |
25,232 |
 |
 |
$ |
38,428 |
 |
 |
$ |
(2,458 |
) |
 |
$ |
(2,222 |
) |
 |
$ |
(8,516 |
) |
|
Adjusted EBITDA margin |
 |
 |
13.8 |
% |
 |
 |
31.1 |
% |
 |
 |
(9.1 |
)% |
 |
 |
(6.9 |
)% |
 |
 |
||
(1) Restructuring and severance costs include actions associated with the previously announced cost reduction efforts that include the consolidation of our JPF production facilities and discontinuation of the K-MAX® aircraft production line.
(2) Integration and implementation costs include one-time costs associated with the integration of Aircraft Wheel and Brake and costs associated with the set-up of a new joint venture to satisfy existing offset requirements the Company has with a foreign customer.
(3) Program assets impairment includes the write-off of long lead parts received in the current period associated with K-MAX® program which were determined to have no alternative use.
**Corp/Elims Operating income (loss) represents the Corporate office expenses and $1.1 million of unallocated expenses that are shown on the Consolidated Statement of Earnings as their own line items.
|
Table 7. Adjusted EBITDA (unaudited) |
 |
 |
 |
 |
||||||||||||||||
|
Thousands of U.S. dollars |
 |
Three Months Ended December 31, 2022 |
||||||||||||||||||
|
 |
 |
Consolidated |
 |
Engineered Products |
 |
Precision Products |
 |
Structures |
 |
Corp/Elims** |
||||||||||
|
Adjusted EBITDA |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Consolidated Results |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Net sales |
 |
$ |
197,143 |
 |
 |
$ |
113,972 |
 |
 |
$ |
49,925 |
 |
 |
$ |
33,246 |
 |
 |
$ |
— |
 |
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Net (loss) earnings |
 |
$ |
(55,942 |
) |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Interest expense, net |
 |
 |
8,786 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Income tax expense (benefit) |
 |
 |
(18,991 |
) |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Non-service pension and post retirement benefit income |
 |
 |
(5,145 |
) |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Other income, net |
 |
 |
(2,100 |
) |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Operating income (loss) |
 |
$ |
(73,392 |
) |
 |
$ |
17,168 |
 |
 |
$ |
5,628 |
 |
 |
$ |
(2,502 |
) |
 |
$ |
(93,686 |
) |
|
Depreciation and amortization |
 |
 |
13,675 |
 |
 |
 |
11,231 |
 |
 |
 |
785 |
 |
 |
 |
856 |
 |
 |
 |
803 |
 |
|
Goodwill impairment |
 |
 |
25,306 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
25,306 |
 |
|
Program assets impairment |
 |
 |
53,677 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
53,677 |
 |
|
Restructuring and severance costs |
 |
 |
6,989 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
6,989 |
 |
|
Cost associated with corporate development activities |
 |
 |
1,167 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
1,167 |
 |
|
Inventory step-up associated with acquisition |
 |
 |
2,299 |
 |
 |
 |
2,299 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
|
Other Adjustments |
 |
$ |
103,113 |
 |
 |
$ |
13,530 |
 |
 |
$ |
785 |
 |
 |
$ |
856 |
 |
 |
$ |
87,942 |
 |
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Adjusted EBITDA |
 |
$ |
29,721 |
 |
 |
$ |
30,698 |
 |
 |
$ |
6,413 |
 |
 |
$ |
(1,646 |
) |
 |
$ |
(5,744 |
) |
|
Adjusted EBITDA margin |
 |
 |
15.1 |
% |
 |
 |
26.9 |
% |
 |
 |
12.8 |
% |
 |
 |
(5.0 |
)% |
 |
 |
||
(1)Information for the period ended December 31, 2022 has been revised from amounts reported in prior periods to correct errors related to the accounting for certain labor costs at one business in the Precision Products segment and the net realizable value on certain portions of the Company’s inventory at another business in the Structures segment.
**Corp/Elims Operating income (loss) represents the Corporate office expenses and $86.0 million of unallocated expenses that are shown on the Consolidated Statement of Earnings as their own line items.
|
Table 8. Adjusted EBITDA (unaudited) |
 |
 |
 |
 |
||||||||||||||||
|
Thousands of U.S. dollars |
 |
Twelve Months Ended December 31, 2023 |
||||||||||||||||||
|
 |
 |
Consolidated |
 |
Engineered Products |
 |
Precision Products |
 |
Structures |
 |
Corp/Elims** |
||||||||||
|
Adjusted EBITDA |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Consolidated Results |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Net sales |
 |
$ |
775,854 |
 |
 |
$ |
512,831 |
 |
 |
$ |
129,147 |
 |
 |
$ |
133,876 |
 |
 |
$ |
— |
 |
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Net earnings |
 |
$ |
7,947 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Interest expense, net |
 |
 |
39,997 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Income tax expense |
 |
 |
2,738 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Non-service pension and post retirement benefit income |
 |
 |
(1,240 |
) |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Other income, net |
 |
 |
(339 |
) |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Operating income (loss) |
 |
$ |
49,103 |
 |
 |
$ |
107,863 |
 |
 |
$ |
(4,532 |
) |
 |
$ |
(9,169 |
) |
 |
$ |
(45,059 |
) |
|
Depreciation and amortization |
 |
 |
50,038 |
 |
 |
 |
40,408 |
 |
 |
 |
3,292 |
 |
 |
 |
3,106 |
 |
 |
 |
3,232 |
 |
|
Restructuring and severance costs(1) |
 |
 |
3,392 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
3,392 |
 |
|
Integration and implementation costs(2) |
 |
 |
2,888 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
2,888 |
 |
|
Costs associated with corporate development activities(3) |
 |
 |
947 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
947 |
 |
|
Program assets impairment(4) |
 |
 |
1,064 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
1,064 |
 |
|
Tax contingency reversal(5) |
 |
 |
(757 |
) |
 |
 |
(757 |
) |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
|
Other Adjustments |
 |
$ |
57,572 |
 |
 |
$ |
39,651 |
 |
 |
$ |
3,292 |
 |
 |
$ |
3,106 |
 |
 |
$ |
11,523 |
 |
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Adjusted EBITDA |
 |
$ |
106,675 |
 |
 |
$ |
147,514 |
 |
 |
$ |
(1,240 |
) |
 |
$ |
(6,063 |
) |
 |
$ |
(33,536 |
) |
|
Adjusted EBITDA margin |
 |
 |
13.7 |
% |
 |
 |
28.8 |
% |
 |
 |
(1.0 |
)% |
 |
 |
(4.5 |
)% |
 |
 |
||
(1) Restructuring and severance costs include actions associated with the previously announced cost reduction efforts that include the consolidation of our JPF production facilities and discontinuation of the K-MAX® aircraft production line.
(2) Integration and implementation costs include one-time costs associated with the integration of Aircraft Wheel and Brake and costs associated with the set-up of a new joint venture to satisfy existing offset requirements the Company has with a foreign customer.
(3) Costs associated with corporate development activities include one-time costs associated with the sale of Kaman Corporation and its subsidiaries.
(4) Program assets impairment includes the write-off of long lead parts received in the current period associated with K-MAX® program which were determined to have no alternative use.
(5) Following an evaluation of a wide range of factors, including legislative activity and administrative practices, the Company deemed a reserve was no longer needed for a certain tax contingency.
**Corp/Elims Operating income (loss) represents the Corporate office expenses and $5.0 million of unallocated expenses that are shown on the Consolidated Statement of Earnings as their own line items.
|
Table 9. Adjusted EBITDA (unaudited) |
 |
 |
 |
 |
||||||||||||||||
|
Thousands of U.S. dollars |
 |
Twelve Months Ended December 31, 2022 |
||||||||||||||||||
|
 |
 |
Consolidated |
 |
Engineered Products |
 |
Precision Products |
 |
Structures |
 |
Corp/Elims** |
||||||||||
|
Adjusted EBITDA |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Consolidated Results |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Net sales |
 |
$ |
687,961 |
 |
 |
$ |
377,241 |
 |
 |
$ |
185,023 |
 |
 |
$ |
125,697 |
 |
 |
$ |
— |
 |
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Net earnings |
 |
$ |
(48,573 |
) |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Interest expense, net |
 |
 |
16,874 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Income tax (benefit) expense |
 |
 |
(17,360 |
) |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Non-service pension and post retirement benefit income |
 |
 |
(20,574 |
) |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Other income, net |
 |
 |
315 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||
|
Operating (loss) income |
 |
$ |
(69,318 |
) |
 |
$ |
57,833 |
 |
 |
$ |
16,353 |
 |
 |
$ |
(4,623 |
) |
 |
$ |
(138,881 |
) |
|
Depreciation and amortization |
 |
 |
40,712 |
 |
 |
 |
30,461 |
 |
 |
 |
3,663 |
 |
 |
 |
3,519 |
 |
 |
 |
3,069 |
 |
|
Goodwill impairment |
 |
 |
25,306 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
25,306 |
 |
|
Program assets impairment |
 |
 |
53,677 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
53,677 |
 |
|
Restructuring and severance costs |
 |
 |
9,842 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
9,842 |
 |
|
Cost associated with corporate development activities |
 |
 |
14,420 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
14,420 |
 |
|
Inventory step-up associated with acquisition |
 |
 |
3,059 |
 |
 |
 |
3,059 |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
|
Gain on sale of business |
 |
 |
(457 |
) |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
— |
 |
 |
 |
(457 |
) |
|
Other Adjustments |
 |
$ |
146,559 |
 |
 |
$ |
33,520 |
 |
 |
$ |
3,663 |
 |
 |
$ |
3,519 |
 |
 |
$ |
105,857 |
 |
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
||||||||||
|
Adjusted EBITDA |
 |
$ |
77,241 |
 |
 |
$ |
91,353 |
 |
 |
$ |
20,016 |
 |
 |
$ |
(1,104 |
) |
 |
$ |
(33,024 |
) |
|
Adjusted EBITDA margin |
 |
 |
11.2 |
% |
 |
 |
24.2 |
% |
 |
 |
10.8 |
% |
 |
 |
(0.9 |
)% |
 |
 |
||
(1)Information for the period December 31, 2022 has been revised from amounts reported in prior periods to correct errors related to the accounting for certain labor costs at one business in the Precision Products segment and the net realizable value on certain portions of the Company’s inventory at another business in the Structures segment. Refer to the Company’s Form 10-K for the year ended December 31, 2023 for further information.
**Corp/Elims Operating income (loss) represents the Corporate office expenses and $88.5 million of unallocated expenses that are shown on the Consolidated Statement of Earnings as their own line items.
Contacts
Investor Relations
(860) 243-7100
[email protected]
